Another announcement/launch by Coveney yesterday and he spent the day on every media outlet possible
The Mortgage to rent scheme that has flopped to date is getting a revamp ("217 transactions have been completed to date with a further 635 reaching conclusion")
Groups to buy struggling owners' homes and rent them back
http://www.independent.ie/business/pers ... 36362.html
Quote:
Two groups are set to buy distressed mortgages from banks and rent them back to those no longer able to make home-loan repayments.
Those who qualify and agree to the scheme could see their mortgage debts wiped out.
The homes would be leased to local authorities, with the owners becoming renters.
It comes after changes to the State's mortgage-to-rent scheme that now allows bulk-buying of mortgages to be rented back to those in deep arrears.
Some 34,000 mortgages are more than two years in arrears, with a serious risk of these houses being repossessed.
A group of businessmen with international financial backing, called Arizun, said they had up to €500m and could buy thousands of distressed mortgages.
Mortgage campaigner David Hall's ICare group is also preparing to buy up mortgages that are in arrears.
The funds are lining up to buy mortgages that are in long-term arrears from banks following changes to the State's mortgage-to-rent scheme...
...Arizun's chief executive Cathal O'Leary said the homeowners in arrears would have their outstanding mortgage debt cancelled. They would have the option to buy back the property at a later date, and would have a 40pc share in any rise in the property's valuation.
Asked if Arizun was not just another vulture fund, Mr O'Leary said: "We are writing off the entire mortgage debt. I don't know any fund prepared to do that, and we are providing a 20-year solution."
He said his fund could buy up to 5,000 distressed mortgages. A private lease arrangement could be arrived at for those who do not qualify for social housing.
The property could be bought back at current market value.
http://www.merrionstreet.ie/en/News-Roo ... tting.html
Quote:
The key changes to the scheme identified in the review are:
• Lenders will be required to formally communicate with borrowers as to why they are not suitable for the scheme.
• Flexibility will be provided in relation to the size of properties which qualify for the scheme. In practical terms, this means that an assessment of the property size suitable to a particular household will allow for a maximum of two additional bedrooms in the property above the actual needs of the household, with the property still being considered eligible.
• The property price thresholds for eligibility under the scheme will be increased in line with the acquisition thresholds for social housing generally. The threshold for a house in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow is being increased to €365,000 while the threshold for an apartment / townhouse in these areas is being increased to €310,000. For the rest of the country, the threshold for a house is being increased to €280,000 and for an apartment / townhouse to €210,000. The most significant increases are in the more rural locations which is consistent with market findings. These thresholds will be subject to regular reviews taking account of the market at the time and will continue remain in line with the acquisition thresholds for social housing generally.
The likes of David Hall and the Phoenix Project welcomed this move yesterday (no surprise there from David Hall as he's looking to get involved in buying some of these mortgages).
But the Phoenix Project said they'd like the €365k threshold in Dublin raised higher as well as a higher cap on incomes which they feel are set to low currently (I think I heard 40k mentioned yesterday).
This was discussed on The Last Word last night. BB from AAM was on and said he couldn't get his head around this....if your 1 of the 35,000 in long term arrears and paying very little, how would having a new owner of your debt change things? Unless the write down 'encouraged' you to start paying again if you were indeed int he position to do so.
The guy from Arizun said they'd be renting the houses at current rental rates. And given where rents are at, how can people afford to pay that either!
We're getting to the stage where they might as well just throw the houses to them for free and be done with it. It's heading in that direction
Statistics: Posted by FreeFallin — Thu Feb 09, 2017 12:11 pm